The Art of the Deal

Bruce Wasserstein’s Last Surprise

The mystery shrouding Bruce Wasserstein’s death, last October, at 61, fit the billionaire investment banker’s M.O. Always secretive, he withdrew further as his health apparently failed and his personal relationships turned tumultuous. With stories about Wasserstein’s brilliant rise and the three different Wall Street firms he inspired, including his contentious final act as head of Lazard, the author profiles a master negotiator who made his own rules.

At the New York Stock Exchange on the day of Lazard’s I.P.O., May 5, 2005. From AFP/Getty Images.

The last years of Bruce Wasserstein, the investment-banking mogul who died at age 61 last October after a brief, undisclosed illness, remain shrouded in mystery, which is probably how Wasserstein would have wanted it. “It was almost like part of his grand strategy,” explains Joseph Perella, who founded the investment bank Wasserstein Perella & Co. with him in 1988. “The less people know about you and your feelings, the more powerful your negotiating position will be—in everything. So, that’s the way he was. Nothing about his health, nothing about his diet, nothing about his personal life—we never even knew he was married to someone before Chris [Parrott, his second wife] until I read it in your book The Last Tycoons.” He seems genuinely shocked.

The mysteries start with where his grave is. When Wasserstein was growing up, his family lived in the predominantly Jewish Midwood section of Brooklyn, and Bruce attended the Orthodox Yeshiva of Flatbush, on Avenue J. So Brooklyn would be the logical place for the Wasserstein-family plot, which would contain not only his grave but also those of his sister Wendy, the Pulitzer Prize–winning playwright, who died in 2006 at age 55 from lymphoma; his half-sister, Sandra, a senior executive at Citibank, who died in 1997 at age 60 from breast cancer; and his parents, Morris and Lola Wasserstein, who died in 2003 and 2007, respectively.

But apparently this is privileged information. And the idea that either Bruce’s or Wendy’s admirers might want to pay their respects by visiting their gravesite is not received kindly. “I find that question offensive,” says Georgette Levis, Bruce’s sole surviving sister and the proprietor of the Wilburton Inn, in Manchester, Vermont, when asked to disclose the location. She would be willing to talk about her brother and his life, but only with the consent of Bruce’s oldest child, Pamela, a 32-year-old lawyer who worked at the Wall Street law firm Wachtell Lipton and Leon Black’s Apollo Management L.P. before becoming a project director at the Tribeca Film Institute. (With his second wife, Christine Parrott, Wasserstein had three children: Pamela, Ben, who works with a producer at HBO, and Scoop, now a law-school student. He went on to have two more sons, Jack and Dash, with his third wife, Claude Becker, a former CBS News producer.) But when Georgette asks Pamela if it would be all right to be interviewed, she nixes it.

Then there is the seemingly straightforward question of precisely how Wasserstein died, three days after being hospitalized suddenly in New York with “heart palpitations” experienced in the backseat of his chauffeur-driven sedan, according to a former colleague. Shortly after an ambulance took him to a local hospital (nobody will say which one), Lazard—the 162-year-old publicly traded investment-banking firm of which Wasserstein was chairman, C.E.O., and the largest individual shareholder—issued the following statement: “His condition is serious, but he is stable and recovering.”

According to several people familiar with what happened to Wasserstein that Sunday afternoon, Lazard’s public statement was inaccurate. He was not recovering, nor did he have any prospect of recovering. He was put on life support immediately upon arrival at the hospital. It was just a question of how long he would hang on. After his death, Lazard issued another cryptic statement: “Mr. Wasserstein had been hospitalized in serious condition for an irregular heartbeat. The exact cause of death has not yet been determined.” Neither Lazard nor Howard Rubenstein, a spokesman for the Wasserstein family, said how he died, and others who knew what happened remained circumspect. “I think he met some unexpected problem that caused his untimely end—very sad, amazingly sad,” says one of his longtime friends. What made the news so shocking to Wall Street lawyer Toby Myerson was that he had seen his friend four months before, on July 20, at Myerson’s birthday party in the Hamptons. “He looked healthy,” Myerson recalls. “He was very engaged and engaging.” He was seated next to Kathleen Begala, Democratic strategist Paul Begala’s sister and the wife of Yves-André Istel, an investment banker who had worked for Wasserstein for eight years. “Bruce and Kathleen had a very, very animated discussion about politics and the present state of political affairs. He was witty and enthusiastic.” Says another person who saw Wasserstein last summer, “He frankly looked pretty well. In this chapter of his life, he was functioning on all cylinders, which is why his sudden demise was a surprise to all of us.” Asked about his “sudden demise,” this person says, “I would have thought you’d heard the story from lots of people. If you haven’t heard about it, that means the family members and others didn’t want to talk about it. So I shouldn’t front-run them.”

Indeed, the story that lots of people are telling is that Wasserstein was living an unhealthy lifestyle. (Years earlier, it is said, he suffered from a heart condition and had quadruple-bypass surgery.) His family is extremely eager to squelch such rumors. As this article went to press, an informed source, in conjunction with Howard Rubenstein and Judi Mackey, Lazard’s public-relations head, finally told Vanity Fair, “While in a car on his way to a lunch downtown with his daughter Pamela, Mr. Wasserstein experienced a sudden and unexpected cardiac arrhythmia. The arrhythmia caused him to lose consciousness. The driver called 911. Mr. Wasserstein was rushed in an ambulance to a hospital in Manhattan. His condition was initially stabilized in the hospital. Despite efforts at supportive care and indications of recovery, he ultimately died of heart failure secondary to the arrhythmia.”

Some of the rumors came about because Wasserstein had a hectic romantic life right up to the end. After splitting up with the glamorous and stunning Claude, he fathered a child, in 2008, with a recent graduate of Columbia Business School. In January 2009, a few months after the birth of that child—a daughter—he married another woman, Angela Chao, then 35, an executive at her father’s shipping-and-finance conglomerate, and the sister of Elaine Chao, George W. Bush’s labor secretary.

Lazard’s apparent obfuscation of Wasserstein’s health issues is nothing new, however. In December 2005, seven months after he engineered the initial public offering of Lazard—after which the firm was required to make regular public disclosures to the Securities and Exchange Commission and to investors about finances and material events—Wasserstein gave two interviews in which he said he had just recovered from pneumonia and several bouts of the flu. Then, in February 2006, he disappeared from Lazard’s offices for four months. The firm made no announcement concerning the health of its C.E.O., despite the fact that its public shareholders were entitled to know that information. “He was bruised all over his body,” explains one who saw him after he returned to the office that May. “He looked like a guy who had been going through chemo or something.” Inside the firm, the explanation was that he was suffering a prolonged bout of pneumonia.

Ironically, many of the firm’s partners didn’t even realize he was gone. “This is a sign of how out of touch he was,” says a longtime partner. “Most of us didn’t really notice for a while that he was gone because most of us had very little interaction with the guy. He’d come in; he’d go to his office. He didn’t circulate a lot among the troops, and he had no business. The fact that he was sick wasn’t noticed by a lot of us for a month or two.”

In July 2006, Wasserstein was seen around town again. Someone who spoke with him then at a New York restaurant described him as looking “frail” and “shaky” from having lost “so much weight.” Another person who saw him that same evening said that he looked like a “sickly 70-year-old,” instead of the once invincible conqueror, and added, “He is in bad shape.” Felix Rohatyn, the longtime Lazard partner and former U.S. ambassador to France, and his wife, Elizabeth, saw Wasserstein at an East Side brasserie around that time and remarked to themselves that he looked terrible. Rohatyn had heard that Wasserstein had been out of the office for several months and wondered why Lazard hadn’t disclosed that fact to the market. “We were a newly public company,” says a Lazard partner. “What the fuck? Why hadn’t he said anything to anybody?”

On August 2, 2006, after Lazard reported its second-quarter earnings, the Financial Times asked Steve Golub, who had been acting as the firm’s C.E.O. while Wasserstein was away, point-blank about Wasserstein’s health. “He’s fine,” Golub replied.

By November 2006, Wasserstein was ready to re-introduce himself to Wall Street and corporate America. He gave an exclusive interview to BusinessWeek, which put him on the cover. This was a reporting coup for sure, since Wasserstein had all but abandoned the idea of allowing himself to be the focus of a major magazine story after Deirdre Fanning of Forbes had written the infamous “Bid ‘Em Up Bruce” cover story, of August 1989, which suggested that Wasserstein encouraged his clients to hugely overpay for companies. Wasserstein hated the nickname and felt betrayed by the press—which had previously fawned over him—but there was no disputing the story’s main premise, especially after both Allied Stores Corporation and Federated Department Stores Inc. filed for bankruptcy following a protracted takeover battle won by Wasserstein’s client Robert Campeau, a little-known Canadian real-estate developer, who offered much more than other bidders using primarily borrowed money that he was unable to pay back. The approximately $7 billion bankruptcy filing was the largest ever in retailing at the time.

In the pictures for the BusinessWeek article, Wasserstein looked thinner, heavily made-up, and awkwardly posed in his Savile Row suit. Asked about the rumors that he was “gravely ill,” he told reporter Anthony Bianco, “It’s just silly,” and added, “I’m exactly the same weight I was ten years ago. I go through these cycles. I am trying to be fit.” Moments later, Bianco reported, Bruce was enjoying “an elaborate coffee-and-ice-cream concoction” he needed to “fortify” himself “for my first press interview” as Lazard’s C.E.O.

Joe Perella recalls how “Bruce’s standard diet was hamburger for lunch, shrimp cocktail and steak for dinner. It never varied, and I had a lot of meals with him, right? So, finally, one day I say, ‘Bruce, look, you’re not going to want to hear this, but I don’t think you’re eating a healthy diet.’ And he said to me, ‘You’re right. I don’t want to hear it.’”

Such behavior was typical of Wasserstein, a lusty contrarian who fantasized that he was exempt from life’s vicissitudes. Seeing himself as the Nietzschean Übermensch, he believed he played by different rules than everyone else. “Nietzsche’s whole posit was that there are certain superhumans who are above the fray, above normal constraints,” a friend of Wasserstein’s once told me. “He believes he is that. And so, if you believe that, you’re not bound by common morality, and you’re just incredibly ambitious and impatient and not held back by that.”

Nobody knew more about Wasserstein, and in particular this aspect of him, than Perella, the founder of First Boston’s fledgling mergers-and-acquisitions group. He first encountered the young, disheveled, and brilliant Bruce Wasserstein in 1976, when Wasserstein was an energetic associate at Cravath Swaine & Moore, the white-shoe Wall Street law firm. He had gone to Cravath after receiving a joint graduate degree in business and law from Harvard and after a year studying British merger law at Cambridge University on a Knox Traveling Fellowship. He also had worked as a consumer activist, researching and writing about takeovers, with Ralph Nader and Mark Green, the once and future candidate for multiple political offices in New York City and a longtime friend.

Wasserstein and Perella met while working a corporate acquisition, and within 20 minutes of their first encounter, Wasserstein had taken control of the meeting. “He was telling everyone the way the deal should be done from the lawyer’s standpoint, and I said to myself, ‘Holy mackerel, this guy is unreal,’” Perella recounted to Institutional Investor in 1987. “It was one of those moments in life where I knew I had met a rare individual. Bruce had the ability to take what he knew about the law and translate it into action that was going to accomplish the client’s objective.” Nowadays, Perella recalls what he really thought when he first saw Bruce in action: “I don’t know who this S.O.B. is, but he is one smart guy. We’ve got to get to know him.”

Less than a year later, in 1977, by offering to double his salary to $100,000, Perella persuaded Wasserstein to join him at First Boston (now Credit Suisse) to help build the mergers-and-acquisitions group at the firm. Together, they made First Boston a leader in M&A, and then, in 1988, they left the firm after Wasserstein made a dramatic, failed gambit to become C.E.O. They formed Wasserstein Perella & Co., but Perella stayed only five years at the new company—fulfilling the letter of his contract—before decamping to Morgan Stanley as a senior rainmaker. He was “alienated by his partner’s overbearing nature,” according to a Forbes article about Wasserstein’s death. Perella says he has never spoken to Forbes about the split but explained, “Some marriages last forever. Some marriages end in divorce. Ours was a civilized divorce.” (In June 2006, Perella joined forces with Peter Weinberg, the grandson of Sidney Weinberg, the late senior partner of Goldman Sachs, to form Perella Weinberg Partners, a private advisory and money-management boutique.) Wasserstein and Perella had a reunion of sorts in February 2008 at the Lotos Club, in New York, during a dinner celebrating the 20th anniversary of the founding of their firm. It was their most public meeting since Perella had left, in 1993. They sat at the head table together. “It was really quite special because they were arm in arm,” Toby Myerson explains.

Perella, who is elegant, tall, and thin, believes that, underneath the bravado, his former partner was “inherently very, very shy.” He laughingly remembers how, when the two of them posed together for pictures, Wasserstein was always sensitive to his height in relation to Perella’s. Once, when they were being photographed for the cover of Fortune magazine, Wasserstein made a big deal about how they would look together. “I sat down on the freaking steps, and he stood over me,” Perella says. “Oh, God, he just wouldn’t pose for a picture standing side by side. It always had to be adjusted.”

Wasserstein loved to negotiate, even over the smallest and most insignificant things, like what time he would meet someone for lunch, or if they would first meet at the elevator or downstairs in the lobby of the building. “[After such negotiations] you were always off-balance and exhausted,” Perella recalls. “It was very complex. It was caring, but weird.” Larry Grafstein, the head of M&A at Rothschild in New York, who worked for Wasserstein for years at Wasserstein Perella and at Lazard, wrote in an essay in The New Republic how exasperating that aspect of Wasserstein’s personality was. “This could be quite exhausting,” he recalled. “He had a remarkable ability to get his way, even among the headstrong and rather self-important bankers and lawyers who make up the mergers- and-acquisitions community. After a while, you just began to cave. But then he wouldn’t allow you to capitulate, so the negotiation cycle would begin anew.”

Myerson thinks all these contradictions made his friend extraordinary. “He was an amazing intellect and human being,” he says. “While being a stunningly original thinker and very forceful in business, he was always tender and caring with his family and certainly was in reaching out to embrace Lucy [Wendy Wasserstein’s daughter] when his sister passed away in a very untimely way. Despite his public persona he was also a very private person. For the people who knew him well he engendered enormous loyalty.”

Jeffrey Rosen, another longtime friend of Wasserstein’s and his colleague at First Boston, Wasserstein Perella & Co., and Lazard, agrees. “I think there are very few people who from a business perspective had such an impact on our business over 30 years, spanning four decades,” he says. “If you go back over those 30 years, what you discover is he had a significant influence, if not the significant influence, in building three different firms and three firms that were each very different, one from the others. And building firms, not destroying them. I think he left each of those firms in much better shape than when he arrived.”

Rosen tells the story of receiving a phone call after Wasserstein died from Art Reichstetter, a banker who had also worked with Wasserstein at all three firms. At the end of the conversation, Reichstetter told Rosen, “He really believed in people.” That comment got Rosen thinking. “And I realized the wisdom of what Reichstetter said. If you look at the success of the firms with which Bruce was associated,” says Rosen, “I believe that what made his life remarkable was the impact he had on people: the people in whom he believed, the people who he supported—and obviously there were those who he didn’t—and the effect that he had on the professional and personal development of those people over a long period of time. His success in building firms was his success in building people. And you can see those people throughout Wall Street today.” Rosen then recites a list of people who once worked with Wasserstein and Perella and now are leaders on Wall Street, among them Raymond McGuire, head of global banking at Citigroup; Hugh “Skip” McGee, global head of investment banking at Barclays Capital (and previously at Lehman Brothers); Gary Parr, a deputy chairman at Lazard; Jimmy Elliott, the global head of M&A at J. P. Morgan Chase; and Brian Finn, president of investment banking and head of alternative investments at Credit Suisse.

At Wasserstein’s December 7 memorial service, at the Vivian Beaumont Theater, in New York’s Lincoln Center, the eulogizers waxed eloquent. “Bruce was a consummate gentleman, a man of his word whose handshake was the same as a written agreement,” said Marty Lipton, the senior partner at Wachtell Lipton. Vernon Jordan, the Lazard banker and a member of its board of directors, said, “To measure the life and accomplishments of Bruce Wasserstein is as if one would take a thimble and try to empty an ocean. It would be as if one sought to measure the expanse of the heavens with the span of the human hand.… Something vast and powerful and good has passed from us. It is as though a mighty oak has fallen, leaving an empty and glaring space against the sky where he stood.” (Neither Lipton nor Jordan would be interviewed about Wasserstein for this article.)

But the man Jordan and Lipton described is the same one who in 1995 had his maid pack up the belongings of his girlfriend Lorinda Ash, who had lived with him for three years. Wasserstein had left his second wife, Christine Parrott, and their three children for Ash and then summarily dismissed her after he met Claude Becker, a tall, dark-haired French beauty. (Wasserstein and his first wife, Laura Lynelle Killin, had divorced in 1974, after six years of marriage.) Wasserstein and Becker were married in 1995 and moved into a duplex at 927 Fifth Avenue. He split with her sometime in 2008. (Claude, who was said to have been heartbroken, declined to comment for this article.) Shortly thereafter he was seen squiring Angela Chao to parties, including Lally Weymouth’s exclusive Fourth of July party in Southampton, and to dinners in Manhattan. Word around town was that Chao was fine with his decision to adopt Wendy Wasserstein’s daughter, Lucy Jane, and have her come live at 927 Fifth after Wendy’s death. (As was chronicled by Wendy herself in the pages of The New Yorker, she had conceived her daughter in 1999 through in-vitro fertilization. She never identified the father.)

And this is the same Bruce Wasserstein who deprived the state and city of New York of some $75 million in capital-gains taxes (12 percent of his capital gain of around $625 million) when he claimed to have moved his residence to London in 2001, after he had sold Wasserstein Perella to Dresdner Bank, and then Allianz, the giant German insurer, bought Dresdner. While Wasserstein spent a lot of time in London during 2001, he maintained his duplex penthouse apartment at 927 Fifth Avenue, his sprawling mansion in East Hampton (known as “Cranberry Dune”), and his home in Santa Barbara. “Bruce always maintained it was a lifestyle choice and other things,” a friend recalls. “It is a fact that he moved to London. I don’t think I want to try to characterize his reasons for it.”

Wasserstein promptly moved back to New York, as the head of Lazard, in early 2002. (For unexplained reasons, the tax authorities in the state of New York allowed Wasserstein to get away with this gambit.) “It’s classic Bruce,” one of his former partners tells me. “When he got the leverage, instead of taking a 51–49 win, he’d go for the 99–1 win.”

The views people formed of Wasserstein during his tenure at Lazard—which he wrested away from Michel David-Weill, the firm’s patriarch, who had hired him—are mostly unflattering. David-Weill left the firm in May 2005, after Wasserstein had crafted a clever strategy to get rid of him by taking public the longtime private partnership. Many of Wasserstein’s former partners there think he then pressed his advantage at the firm in an unfair way, even as they acknowledge that had he not engineered the I.P.O. the firm would now be a shadow of its former self, assuming it was even still around. Yet, they remain appalled by how little he actually did—both in bringing in new business and in managing the company—while negotiating for himself one huge pay package after another. “He left all the day-to-day work up to [newly appointed C.E.O.] Ken Jacobs and [vice-chairman] Steve Golub,” says one Lazard banker, “and he left all the leadership stuff to the two of them. He just never spent any time with anybody else, except to have us drag his sorry ass to meetings.”

In January 2008, Wasserstein wrung from his handpicked board of directors a new five-year employment contract that paid him $900,000 a year in salary, plus an annual unspecified bonus, plus 2.7 million shares of Lazard, worth just under $100 million the day the deal was struck. He also received $41 million in compensation for 2007. (Wasserstein had originally asked for a 10-year contract for $365 million.) During the negotiations, he dared the board to fire him.

After word of the deal leaked out at the firm, his partners were dumbstruck by his selfishness and greed, especially as they considered him to be well past his sell-by date and even a liability with some clients. They knew that Wasserstein had pledged to the analyst community that Lazard would pay out a maximum of 57.5 percent of annual revenue in the form of compensation, so this was a zero-sum game: what he took for himself would necessarily cut into what they could make. “When they came and told us this, we were like, ‘Are you fucking crazy? How could you have done that?’” recalls a managing director. “First of all, it’s a massive hit to the compensation pool for a guy who contributed nothing. If he generated $30 or $40 million worth of fees in the nine years he was at Lazard, he generated a lot. I mean, he was just useless.”

The argument coming from the board was that had Wasserstein left and the stock subsequently dropped they would have gotten sued. Rather than face that prospect, the board capitulated. But many of the senior bankers, who were also big shareholders, found that argument severely lacking. “The difference between his perception of his value and everybody else’s was a wide chasm,” one Lazard banker explains. “If you want to look at him in the best light, you would say he just had an incredible view of himself. If you want to look at him in the worst light, you would say he didn’t give a damn. He just could take the money. He could convince the board, and he took it.”

A number of senior Lazard partners ended up screaming at the board members once they had heard about the new deal: “Who cares? Let him go! It’d be the best thing that could happen to the firm!” (Lazard declined to make any of its board members available to be interviewed or to comment on any part of this story. On behalf of the firm, Judi Mackey issued this statement: “Bruce was a visionary leader of the firm from January of 2002 until his untimely passing in October 2009. We continue to mourn his loss.”
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In the end, Wasserstein’s partners were terribly demoralized. “He was a very, very strange guy,” says one. “I remember hearing somebody say, ‘How can the guy take that kind of money and walk down the hall in front of us?’ Or ‘How can he face his partners after doing that?’ And somebody answered with words to the effect of ‘He’s not even thinking that way.’ Where the average guy would be embarrassed, that just wasn’t Bruce’s personality. The guy was just so different than most people that you and I know. I’ve never met anybody like him. This stuff just rolled off his back. It was kind of, well, ‘I won. You lost.’ Or ‘I won. I don’t really care if you lost. I won.’”

Adds another former partner, “He was a horrible manager, because he was completely self-involved by the time he had gotten control of the firm.… You see that in the succession of marriages and children, and blowing Claude up, and marrying Chao, and having an affair with a business-school student and having a child out of wedlock. He was just given over to complete narcissism. He had lost his relevance. Nobody in corporate America particularly cared about what he had to say, and he wasn’t particularly good about saying it. Nine out of 10 things that came out of his mouth were crazy, or unfounded, or reflected a lack of attention to his audience and what their issues were. One out of 10 was smart, scary smart. But you’d take him to client meetings and most of the time you’d be exchanging looks with the C.E.O. of the company that you were taking him to see.” The message the clients delivered time and time again was a simple one: Don’t bring him back.

There is even debate inside the firm about the role he had in Kraft’s prolonged—and ultimately successful—$21.4 billion acquisition of Cadbury, the British chocolate company. Many published reports suggested that Wasserstein was the architect of Kraft’s strategy and that he personally advised Kraft and its C.E.O., Irene Rosenfeld, during the months before he died. Bloomberg News wrote on January 19 that the successful deal “seals the legacy” of Wasserstein, and quoted former Lazard banker Philip Keevil as saying, “This deal will be a monument to Bruce.”

Wasserstein does get credit at Lazard for bringing in the business—in the sense that he finally brought in a deal—but the dénouement was seen by some as the same old script of getting the client to win by paying too much. However, Antonio Weiss, Lazard’s global head of investment banking, who worked with Wasserstein closely on the deal and led it after Wasserstein died, couldn’t disagree more: “Bruce’s last deal was specifically designed to acquire the target company at the lowest possible price,” he says. “So it was the exact opposite of what is alleged.” (In the end, Kraft increased its original bid by just 10 percent to prevail, according to Weiss.) Lazard and Kraft’s other advisers, meanwhile, split a fee estimated at as much as $58 million. (Rosenfeld declined to be interviewed about Wasserstein’s role.)

Despite the Kraft deal, the consensus among the rank and file at Lazard is that the firm is better off without Wasserstein. “I don’t think Bruce really cared as much about creating a firm where the younger partners could prosper, and the shareholders could prosper, as much as creating a firm that was good for him,” says one senior banker at the firm.

Already, big changes are afoot at Lazard. Last November 17, the board selected Kenneth Jacobs, 51, a longtime Lazard partner who had had a hand in bringing Wasserstein to the firm in 2001, to be Wasserstein’s successor and the firm’s first-ever chairman and C.E.O. chosen by an independent board of directors. Jacobs has been cleaning house of a number of Wasserstein’s close associates: for starters, vice-chairmen Donald Drapkin and Chuck Ward and longtime Wasserstein acolyte Doug Taylor have left the firm. Lazard announced it was setting aside $90 million (pre-tax) to cover costs of an unspecified number of future firings. Two other Wasserstein men—Ashish Bhutani, the head of Lazard’s asset management, and Gary Parr, who came to Lazard via Morgan Stanley—are sticking around. Bhutani and Parr were appointed to the Lazard board in January. Jacobs also brought back Felix Rohatyn, now 81 years old, as a senior adviser, and a huge new office is being constructed for him. “Felix is a legend in our industry, and I am honored that he is returning to the firm that he helped to create,” Jacobs said in January.

After Wasserstein’s death, Jacobs expensed in one fell swoop the costs remaining on Wasserstein’s five-year employment contract. Accordingly, the firm announced that it would take a onetime, non-cash charge of $86.5 million and an additional onetime charge of $60.5 million to accelerate the vesting of deferred cash compensation Wasserstein awarded to other bankers during 2008. Jacobs also announced that Lazard would be increasing the cash and deferred stock it pays its bankers and reducing the amount of deferred cash paid, as a way to become more competitive in hiring, improve retention, and wipe the slate clean for future compensation payouts. Jacobs considered getting rid of Lazard’s fractionally owned corporate jet, which had ferried Wasserstein almost everywhere he went, but ultimately couldn’t bring himself to.

Last December 3, “for tax-planning purposes,” Wasserstein’s estate sold most of the 2.7 million shares he had been granted as part of the January 2008 contract and received net proceeds of around $103 million for them. On February 19 it sold another 1.8 million or so shares for $66.3 million, and on March 16 Lazard filed a registration statement for the estate to sell another 7.6 million or so shares, worth around $282 million. It will still own 4.1 million shares, worth approximately $150 million. In 2009, Forbes had estimated Wasserstein’s net worth at $2.2 billion, making him the 147th wealthiest person in America. Not bad for a guy who was willing to make it up as he went along, as his old friend Larry Grafstein put it.

In his New Republic eulogy, Grafstein recalled how Wasserstein used to laugh about one particularly bungled meeting. He had been running very late and an assistant told him to go immediately to a conference room to meet representatives of the government of Slovakia. “Bruce proceeded to launch into a distinctive, long-winded Wassersteinian monologue about all of the different issues facing Slovakia’s privatization program, corporate sector, and politics generally given its recent separation from the Czech Republic,” Grafstein wrote. “And why, of course, Slovakia needed a banker like Bruce to steer it forward. The guests and his colleagues tried unsuccessfully to interrupt several times. Finally, the finance minister said, ‘Excuse me, Mr. Wasserstein. We are not from Slovakia. We are from Slovenia.’ The way Bruce told it, the room went silent, with ashen faces around the table. After a brief pause, Bruce—always a bit faster and more confident than most of us—answered: ‘And that’s precisely your strategic dilemma.’”